Retail media had a Boom this Year, with a Projected 13.5% Growth rate by 2025

Zepto, a quick commerce provider, achieved a significant milestone by exceeding Rs 1,000 crore in annualized advertising income. Not long behind, its competitor, Blinkit, claimed an astonishing fourfold increase in ad income to more than Rs 400 crore for the fiscal year 2023-24, with strong estimates of crossing Rs 1,000 crore in this fiscal year.

Global corporations are also experiencing the benefits of retail media. Amazon Seller Services, the e-commerce giant's Indian unit, garnered a remarkable Rs 6,649 crore in advertising revenue in 2023-24, while Walmart-owned Flipkart Internet recorded Rs 4,972 crore.

Furthermore, Uber disclosed in August 2024 that its global advertising company had attained an annualized net revenue run rate (ARR) of $1 billion, highlighting the increasing global dominance of retail media.

These figures reflect broader trends found in GroupM's 2024 Global Mid-Year Forecast, which predicts that retail media will expand by 17.5% globally in 2024 and continue to rise with a 13.5% growth rate in 2025.

Locally, the trend is equally strong. According to Statista, advertising income from India's online retail sector surpassed $1 billion (about Rs 80,470 crore) in fiscal year 2023, a twofold increase over FY 2021.

Retail media has clearly established itself as the breakthrough trend of 2024, cementing its place as the fastest-growing category of digital advertising. This unique method to marketing has proven a game changer around the world, including in India, producing considerable income for e-commerce and fast commerce platforms while altering how companies communicate with their audiences.

The allure of retail media stems from its ability to combine precision targeting with measurable results. For brands, retail media networks provide a platform for connecting with customers through compelling communication, increased visibility, and personalized offers.

By exploiting these networks, marketers can not only increase sales but also obtain vital insights into consumer behavior and preferences.

This rapid adoption has changed the balance of digital ad expenditure, with e-commerce and quick commerce platforms now accounting for a large portion of brand marketing budgets. Retail media has become a vital tool for distinguishing oneself in congested marketplaces, making it indispensable for both businesses and advertising platforms in the coming years.

While e-commerce platforms are the most convenient and diverse possibilities, rapid commerce is gaining popularity due to its speed. Quick commerce platforms are gradually expanding their ad business to generate more cash from advertising. Swiggy declared in its initial public offering prospectus that it intended to boost the contribution of advertising revenue by improving its advertising technologies.

In November, Zepto introduced Jarvis, an in-house ad platform for brands and dealers. It assists small and large brands in increasing brand awareness and platform sales by launching tailored and targeted campaigns for Zepto users.

In October, Blinkit launched its Seller Hub program, which is comparable to Amazon's Fulfilled, to enroll companies into its marketplace. The platform gives brands access to sales analytics and advertising capabilities.

Sahiba Sachdev, VP of media planning and buying at Interactive Avenues, previously told that consumers interact with these apps on a daily basis, whether to place orders or follow deliveries, resulting in a degree of involvement comparable to gaming addiction. These platforms are largely clutter-free, providing better ad placements and engaging users at very "mindful" moments.